Report: Japanese Hedge Funds Lead In January

By Murray Coleman

Hedge funds focused on Japanese markets had the best returns in the industry during January, gaining on average 1.26%, data researcher Eurekahedge reported Tuesday.

The Eurekahedge North American Hedge Fund Index gained 0.75% in the month while European hedge funds were up 0.24%.

By contrast, the report noted that:

The MSCI World Index was up 1.87% in January.

The Nikkei 225 gained 0.09% in the month.

The S&P 500 climbed 2.3%.

The MSCI Europe Index rose 1.8% in January.

It might be worth noting that cheaper and more transparent ETFs are available that track hedge fund markets. Those include the IQ Hedge Multi-Strategy Tracker ETF (QAI) and the IQ Merger Arbitrage ETF (MNA). Also, several actively managed long/short ETF have emerged, including:

The iShares Diversified Alternative Trust (ALT) uses computers to crunch data on stocks, bonds and currencies. Humans take it from there to make sure the right moves are being made in both long and short positions.

The Mars Hill Global Relative Value ETF (GRV). It uses stocks across regions, countries and sectors around the globe.

About Focus on Funds

As exchange-traded funds and other investing vehicles have ballooned in number, the task of figuring out what works well and what doesn’t has only gotten harder. Barrons.com’s Focus on Funds looks under the hood of ETFs, mutual funds and hedge funds for overlooked values, actionable ideas and the latest pitfalls for fund investors.

Chris Dieterich has covered the U.S. stock market for The Wall Street Journal and Dow Jones Newswires. He is a graduate of Regis University and the Missouri School of Journalism.